Getting finance for a loan can already feel like an overwhelming process, never mind all the confusing terms finance companies, banks and lenders seem to through into the mix. Here are some commonly used terms to help you navigate the loan process with ease.
- Fixed Interest Rate Loans – Fixed means that it can’t be changed by the lender or the customer for the agreed upon amount of time. Meaning, your loan rate and repayment amount will remain the same for duration of the fixed term.
- Credit Score – A rating based on your credit history that lenders use to determine how likely you will be to pay them on time.
- Credit Reference Agencies – In order to borrow money you need to agree to the lender accessing your credit score. This history is held by credit reference agencies. You can also access these agencies to find out your credit score.
- Debt Consolidation – If you have debt on multiple loans, credit cards or store cards, it is often recommended that you consider debt consolidation. This means combining all your debt onto one loan with one repayment amount.
- Joint Liability – This means you owe a debt with someone else, such as your partner, and are both individually liable for the entire balance. If the other party declares themselves bankrupt or disappears, you will be pursued to repay the full amount.
- Annual Percentage Rate (APR) – Used on lending to show the total cost of borrowing over an average year. This figure will include interest and any upfront fees and charges. It is a great tool to compare deals and loan offers with.
- Term – The length of time of the loan
- Credit Limit – This is what lenders refer to as the maximum amount they will let you borrow.
- Interest Rate – The percentage of interest that is to be paid.
If you still find lenders a difficult field to navigate, iCREDIT can help you compare and choose suitable loans and finance. Our consultants understand the complexities of loan applications and can help make your loan process as simple and hassle-free as possible, all whilst delivering the very best loan option for you.